Editorial: Build more affordable rentals into housing mix

March 22, 2012 |

The Housing Act of 1949 set national goals that included "a decent
home and a suitable living environment for every American family."

In
struggling to reach those goals, U.S. policies have focused largely --
sometimes almost exclusively -- on home ownership, much of it in the
suburbs and exurbs that mushroomed after World War II.

The recent
mortgage foreclosure crisis kept U.S. housing policies centered on home
ownership, even as it began to shake America's unquestioning faith in
ownership as the only suitable housing option, or a foolproof way to
build wealth. Increasing numbers of poor families and elderly people
cannot afford single-family homes of their own. Meanwhile, a new
generation of young professionals -- and older empty-nesters -- want to
live in dense, diverse and walkable neighborhoods, especially in urban
and downtown rental markets.

Roughly
two-thirds of U.S. adults still own their own homes; outside of New
York City, where two-thirds of residents rent, home ownership will
continue to drive the U.S. housing market. Even so, the rental share of
the housing market is growing, even as rentals become increasingly
expensive, said Denise Notice-Scott, managing director of Local
Initiatives Support Corp. in New York City.

LISC, the nation's
largest community development support organization with 29 local sites,
has helped build hundreds of thousands of affordable housing units,
focusing on projects that give residents access to transportation, jobs,
education and other needs.

More than half of low-income tenants
pay more than 50% of their income for rent, challenging the nation to
preserve and expand affordable rental units. From 2000-06, the number of
families with housing costs exceeding 50% of their income increased by 2
million, or 34%, while the nation lost thousands of units of subsidized
housing

"We have to stop losing affordable housing," Notice-Scott said.

One
way to do that is to expand federal low-income housing tax credits and
fully fund federal housing subsidy programs like HOME, which was cut by
38% this year, and Section 8.

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To qualify for federal low-income housing tax
credits, developers must rent to low- and moderate-income tenants. The
developers, many of them nonprofits like Southwest Housing Solutions in
Detroit, raise revenue to pay for projects by selling credits to
investors, who use them as tax breaks. These are effective programs that
also create thousands of good-paying construction jobs.

Before
President Barack Obama took office, the U.S. had lost an estimated
350,000 of its 2 million units of subsidized housing over the previous
decade. They either deteriorated or owners converted them to market-rate
housing. Federal housing assistance programs serve only about one in
four of eligible low-income families.

Under Donovan, HUD has
improved occupancy rates, putting more than 100,000 families into vacant
public housing. HUD has also rebuilt some deteriorating housing stock,
but Congress must do more to preserve it, as well as authorize HUD to
use innovative public-private partnerships to raise money.

Fulfilling
a decades-old promise to make adequate housing a right and reality for
all will take a more balanced housing policy -- one that meets the needs
of the growing market for affordable rentals, as well as for home
ownership.